HOUSINGNEWS REPORT
FEATURED ARTICLE
several times every year,” said Young. “That didn’t happen 50 years ago. That’s going to hurt properties values in certain areas. It’s definitely a real issue that folks in South Florida need to be concerned about.” Young said high-end coastal communities are being subsidized through federal and state beach restoration and flood insurance programs. “Federal, state and local governments have already spent around $2 billion over the last few decades on artificial beaches, and they are sure to spend much more in the future,” wrote Young recently in The New York Times . “When federal taxpayers assume all of the risk of developing and rebuilding vulnerable coastal communities, it encourages the wrong behavior. At some point, coastal resort communities will need to assume
2016 Insight report, flooding due to climate change poses a new threat to the housing industry. Life’s a Beach “One challenge for housing economists is predicting the time path of house prices in areas likely to be impacted by climate change,” wrote Sean Becketti, chief economist at Freddie Mac in the April 2016 Insight report. “Consider an expensive beachfront house that is highly likely to be submerged eventually, although ‘eventually’ is difficult to pin down and may be a long way off. Will the value of the house decline gradually as the expected life of the house becomes shorter? Or, alternatively, will the value of the house — and all the houses around it — plunge the first time a lender refuses to make a mortgage on a nearby house or an insurer refuses to issue a
the risk of storm damage themselves. I would venture to guess that, when this happens, they will be quite a bit more interested in the hazards to which they are exposed.” “I find this sort of ironic,” said Young. “The country leans to the right (politically) and calls itself a free market society, while the federal and state government subsidize flood insurance and coastal restoration programs. While they’re screaming about Obama Care, they are perfectly OK with subsidizing flood insurance. The federal government plays a major role in supporting beach nourishment and at the same time subsidizes flood insurance programs. It’s incredibly ironic.” Economists are also worried about the effects of rising seas on real estate values. According to Freddie Mac’s April
MIAMI BEACH MEDIAN SALES PRICE
$418,750
400,000
There are two threats that South Florida faces from sea level rising. The first is the king tides or nuisance flooding, and the second is long-term coastal erosion.”
$400,000
$389,000
$370,000
$355,000
$356,000
300,000
200,000
100,000
Robert S. Young Coastal geologist at Western Carolina University
0
May 2016
April 2016
June 2016
July 2016 August 2016 September 2016
Source: ATTOM Data Solutions
ATTOM Data Solutions • P7
Made with FlippingBook Online newsletter